There has been a lot of confusion about the health insurance penalty lately. Today I will try to demystify this topic. And answer your questions about whether or not health insurance is mandatory for the year 2020.
The secret truth of Health Insurance Penalty
The health insurance penalty is a burden for every human. so as you know the Affordable Care Act required everyone in the United States to have health insurance or pay a penalty up until this year the Affordable Care. ACTi’s still the law of the land but the? The penalty was repealed by President Trump starting from the year 2019. So, if you did not have health insurance in 2019. you will not have to pay a penalty well too bad. if you didn’t have health insurance.
Moreover, your penalty was paying the big bucks for medical care but that’s a different topic anyways for the year 2020. things have changed a bit in California. Anda few other states implemented the penalty again starting with the year2020.
I am in California and in this article, I will talk about the health insurance penalty. and exclusions available in a mistake. So, again, the new individual mandate for Californians starts in the year 2020. the penalty for not having health insurance starting with the taxable year 2020. will mirror the one under the Affordable Care Act which was six hundred, and ninety-five dollars for adults. and three hundred forty-seven and fifty cents per child under the age of eighteen or 2.5percent of the annual household income. Whichever is greater now whichever is great is a tricky one I had a client a few years ago, whose income was 280thousand per year he was a contractor here in Silicon Valley.
So, he did not have health insurance provided by his company. and did not have an individual medical plan back in 2017. he did not have health insurance. So, he called me to get insurance for the following year here’s why his penalty for the preserve was 7,000 just to give you an idea. And the 30-year-old guy could have bought the cheapest plan, available in Santa Clara County for like $200 a month which is like 2400 per year he would have had insurance. and save big bucks instead of paying the penalty.
So, my point is don’t be tricked by the 2.5 percent it could be quite a lot, and in the case of my client, the penalty was much higher than if he had bought a bronze high deductible plan now there here is the good news. because there is this requirement to have insurance coverage in California, The state will provide financial assistance to qualifying individuals. and families depending on their household size. and income through covered California.
if you already qualify for federal subsidies you might qualify for state subsidies as well. I have a separate article on the income limits. and will post the link in the description of this article take a look to give you an idea. if you are single and your annual income for 2020 will be less than seventy-four thousand nine hundred. and forty then you will qualify for a reduction in your house insurance. Premium vehicle in California now a few words about the exemptions. as it was with the case with the federal exemptions there are situations.
where the health insurance penalty might not apply since exemptions from the mandate. will be claimed when filing twenty state income tax returns. there is not enough information on this topic just yeah, I will try to make a separate article to cover in detail the exemptions from the mandate when it’s available so stay tuned and don’t miss my upcoming article.
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